The peering story

At my first startup, I had a CTO, who was a year younger than me, used to tell me stories of his time at UUNET and what whiney little cheap turds most of the first generation dotCom billionaires were before their tiny little ISP’s sold for hundreds of millions.

This story isn’t about that.

As a Korean, he was asked to set up the asian version of UUnet. Back then Korea’s networking should have been trivial as its a peninsula and most of the population lives in or around a single city, Seoul. Instead it was terrible because none of the Korean networking companies would set up peering points with each other. “See,” he told me, “When you need to connect two networks to each other, you have to set these up, and while they’re free to run, they’re costly to build. How do you decide who pays for the point?”

You might think 50-50 is fair and propose that. If you’re a new player in this space, since you’re the one asking to set up these points, you probably benefit more than network you are trying to pair up with so they expect you to pay all or most of it. You get nowhere with this offer. This is what happened to him.

Korea wasn’t the powerhouse Internet trendsetter they are today. I remember, back then it was often faster to connect to a US site then to another Korean one because your packets to the latter would have to go through peering in the US since there wasn’t any in Korea. In other words, to talk to your neighbor, your message would be sent from Korea, across the Pacific to the US, and then back across the Pacific to Korea. This was the Korean Internet in the early-mid 90’s, all because of a lack of peering there.

On a lark, a friend of his wanted to set up a BBS or something and he dropped a server on his network for his friend to use for free.

Then one day, months later, companies that had previously refused to peer up were contacting him to peer up. As I’ve outlined just now, being the asker is a huge concession in the negotiation. He wondered what changed and looked at his traffic. It turned out that his friend’s BBS or something had become hugely popular in Korea and a lot of that network’s customers were demanding better service to it.

The lesson here is if you have what the other party wants, you hold the cards and the other side has to make the concession.

I bring this story up when I have to explain a basic business principle to others to understand what is going on.

Want to understand why Office is finally out on iOS? Look no further than the peering story.

So I got a PS4 and here's why

[This…](http://www.idigitaltimes.com/articles/21763/20140203/xbox-one-is-terrible-five-reasons-regret.htm)

> The Kinect Can’t Tell A Dog’s Ass From A Human Hand

> I wish that headline was hyperbole. I wish I was exaggerating. But in the two months of having an Xbox One it constantly confuses my dog’s ass for a human hand. Whenever one of my dogs hops on the couch, or even walks past it, the Kinect (more often than not) interrupts whatever I’m watching (because there’s no games, remember?) with a hand gesture icon. It doesn’t select anything, thankfully, but remains on the screen for a few moments and is generally just annoying. And the more it happens the more annoying it gets.

> And it’s not just my dog’s ass that the Kinect has problems with. Microsoft apparently failed to realize that actual human beings sitting on a couch might, occasionally, use their hands. I guess the Kinect test couch was in a setting without cellphones or snacks or lively conversation. If my wife makes a gesture while telling me a story, or I pull my phone up to send some texts, I usually hear the telltale “ding” and my screen goes dark and there’s the hand icon floating on the screen. And, according to Xbox support, there’s really no way to stop this from happening.

> So (nearly) every time my wife talks, or I send a text or my dog crosses the room I have to throw up a “Heil Hitler” gesture at my Kinect so I can continue watching what I want.

(I’ll tell you when it’s actually worth owning over a PS3. Right now, I’m still in [the first stage of grief, the best stage :-)](http://terrychay.com/article/relationship-clubs.shtml).)

Why Siri

[From The iPhone Blog][tipb]:

> Equally interesting is what [[Siri][siri]] portents for Apple. Just like the App Store began the intermediation and exclusion of Google by offering users a better experience interacting with data in apps than via a web search, Siri continues it by theoretically making it easier and more enjoyable to engage in query/response with Siri than with Google. In typical fashion, Apple isn’t building a search engine to compete with Google, they’re building something to obsolete the current conception of search engines. And they’re not doing it by becoming a walled garden — there’s no profit in that. They’re doing it by becoming a walled gate with a multi-directional toll system.

Great observation. Reminds me also of how Apple got out from under the [Microsoft Office Sword of Damocles][microsoft 150] with [Safari][safari] and [iWork][iwork].

[tipb]: http://www.tipb.com/2011/10/12/ios-5-iphone-ipad-walkthrough/ “iOS 5 for iPhone and iPad walkthrough—TiPb”
[microsoft 150]: http://www.apple.com/ca/press/1997/08/AppleMicrosoft.html “Microsoft and Apple Affirm Commitment to Build Next Generation Software for Macintosh. The $150 million was a smokescreen to avoid the obvious anti-trust move of bundling Explorer in order to keep Microsoft continuing to develop Office for the Mac.”
[safari]: http://www.apple.com/safari/ “Safari: Browse the web in smarter, more powerful ways—Apple”
[siri]: http://www.apple.com/iphone/features/siri.html “Ask Siri to help you get things done—Apple”
[iwork]: http://www.apple.com/iwork/ “iWork: Documents, spreadsheets, and presentations. The Mac way—Apple”

The first lines outside Apple Store

You may have forgotten by now, but the first lines outside Apple Store were for the openings…

My graduate school friend, Dave, called me that morning and mentioned that an Apple Store was opening up in the area and we should check it out. We casually showed up just before noon and were totally blown away by the lines.

The line for Apple Store

The line for Apple Store
Apple Store, Palo Alto, California

Olympus C-2500L
(3 exposures, 1/200-1/400sec, f/2.9), iso100, 11.8mm (47mm)

I took this photo nine years ago today (October 6, 2001) outside Apple Store Palo Alto. It was the ninth Apple Store opening, and the first street-level Apple Store.

The sign reads: “5 down, 95 to go.” It is a reference to the fact that Apple has only 5% market share and the retail store concept was trying to reach the other 95%.

Apple modeled the store after the Gap. The anticipation buildup was stolen from the first lines for Microsoft Windows 95 six years earlier. Apple’s nearest competitor, Gateway Country Stores failed three years later in 2004. Microsoft would copy this idea eight years later in 2009with impending failure?

I’d say the retail store idea worked better than Apple could have ever imagined.

Discouraged by the lines that morning, we had lunch across the street at Pluto’s. When we finished, there was no line and we walked right in. They still had some free t-shirts when we left.

That was a good day.

Update: Apple and Microsoft go head-to-head with Microsoft’s fifth store-to-be.

#firstmac

Because it is the 25th anniversary of the Macintosh, there is twitter meme going on where you talk about your first mac.

Reading the headlines on Microsoft, Sony, and Nokia, I’m struck with just how impressive Apple’s quarterly’s are. Yesterday, I noticed that Apple’s front page was bragging that they have had over 300 million iPhone AppStore downloads since its launch.

Instead of going back 25 years, I’d rather go back seven when, in October 2001, Apple released the iPod. Now most of us don’t have to eat as much crow as Slashdot did—I purchased my first iPod one month after the release. However when Steve Jobs said then that the iPod was “the 21st-century Walkman” who didn’t think it was laced with more than a little hubris? And yet, now, we’d probably think that the iPod which reenergized the Macintosh, changed the music industry, and was parlayed into the “it” smartphone was the Walkman and much more.

Sony missed the iPod market because its acquisition of Columbia made the huge technology company a victim of the requests of its media division. Instead of learning from this mistake and moving forward, in 2005, this Japanese engineering company appointed an American entertainment executive to lead their company.

“If you look backward in this business, you’ll be crushed. You have to look forward.”
—Steve Jobs, on the 25th Anniversary of the Macintosh

My #firstmac? Well that was just under 25 years ago. I can still remember making Dungeons and Dragons maps with it in MacPaint at my best friend’s house—that computer changed my life. I went home and begged my parents to buy one and I’ve used sixteen macs since that day—I can name every one.

That moment also marked one of the last times I’d spend with my friend—the years play-acting fantasy books in the junkyard behind his house giving way to separate schooling and separate lives. That computer also changed some others lives. It was purchased with the same drug money that would later kill 18 people.

For different reasons than Steve Jobs, I can’t look back, I’d be crushed. I can only look forward.